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Next week RBA and BOC

Posted by steve on 4th of Jun 2023 at 08:29 am

Next week RBA and BOC comment. Then CPI and FOMC the following week.

AAPL Developer Event on Monday.

Posted by steve on 4th of Jun 2023 at 08:28 am

AAPL Developer Event on Monday. Interested to hear updates on M2 etc. Key levels 178 support and 185 Resistance 

Has anyone thought about what GDP would be without such deficit spending?  


Posted by steve on 3rd of Jun 2023 at 05:01 pm


Thanks for posting - there are some important insights here as to what's been the true driver of prices.   I posted a few weeks ago about enhanced liquidity coming into fold.  I will continue to track and share such data but it's tailored primarily to the short term signals.   I will be curious to see the impact of the TGA restocking in the coming weeks but overall bank reserves are the key determinant which has been greatly enhanced via Fed Credit.   

  1. When the fed extends credit to banks/financial intuitions, it will effectively boost bank reserves (eventually). Fed credit allows us to see a more further out view this way. It will not only spill over into bank reserves eventually but also interbank funds. Banks can lend to each other when they have excess reserves. And they often do. And due to fractional banking, when banks get this excess liquidity from the fed reserve, they are essentially also creating NEW money because they only need to back up a certain % of the amount they are lending. So fed credit is a very powerful tool which spills over into several liquidity sources. View it as its own separate entity which is having a large effect on net liquidity sources with a more delayed effect.  There is also foreign flows that may spill over into various markets - so one could track China and G5 spending as well.  

Prices have not accelerated due to fundamentals improving for most companies  (earnings are down even for some big tech while P/E have ratcheted up significantly).  To be crystal clear, recent earnings have largely bested  only reduced estimates while prices have largely moved up on multiple expansion (primarily tech with other sectors not seeing expansion).  The market is now looking  (projecting) to future earnings increasing so that will be something to monitor in the coming quarters as part of the fundamentals backdrop.   The recent AI talk has been the primary driver for such enhanced P/E with hopes of an onslaught of productivity growth and/or increased demand depending upon the specific company.  Regardless of any reason, we must respect the prevailing trend until such evidence changes. 

With that said, it's all about flows and positioning.  Call buyers force market makers to inject liquidity (hedge their positions via purchases in the market as they sold calls).   Technical analysis simply portrays those actions via a chart (a picture in time) which changes daily in accordance with such flows.  As I have posted several times, there are only two things that matter to market pricing.  1). How much money is available (in the system)  2).  How much of that money is invested on a given day.   Most other items are simply measurement tools to be viewed as guideposts and probabilities - for example  RSI readings and divergences etc etc.   Currently, looking for market to remain stable/upward until late summer with Sept/October period. However, will be watching price action closely on June as I expect some gyrations this month starting with reduced liquidity early next week before rebounding after a few days. Thus is subject to alterations and will keep aprised.  Respect the prevailing trend and adjust when evidence suggests. 

One last thing, the Fed Credit (Loans) work thru the system with a multiplier effect (providing an offset to QT) so as long as short term liquidity remains robust things hold up - however, this also makes core CPI sticky as we have seen over the past year.   Thus, those with assets are much better off than the lower income who do not have appreciating assets to counter the increases from inflation on items they purchase.  Even AI will serve to benefit the affluent vs others especially short term.

Supporting documentation of P/E Expansion (see chart below)

For the S&P, all of the YTD return has been driven entirely by multiple expansion.  This is peculiar in the context of a still-tightening Fed, but could be explained by bets on a Fed pivot and expanding liquidity from Treasury/Fed bank support. (Cameron Dawson).   My comment:  Yes driven by expanding liquidity (synthetic QE) 

Chart 2: Shows the drawdown in the TGA (as of Friday it's now below $30 Billion).  This drawdown has been one source of liquidity for the market. 

Chart3: Strong economic data & mkt rallies have led to jumps in both economic surprises and financial conditions. In 22, these readings would have troubled the Fed, fearing these could exacerbate their fight against inflation, do they have the same urgency now? (Cameron Dawson) 

Chart4: Typically, higher real yields have put downward pressure on Growth/tech valuations, but not in 23. There has been a marked divergence between real yields, back near 23 highs of ~1.6%, and Growth valuations, at 25x now above their pre-pandemic peak. (Cameron Dawson)

Hopefully you appreciate the work put in here to summarize versus someone simply making rogue statements about the market without providing any evidence. 

Summary Of Mobile Rumblings

Posted by steve on 2nd of Jun 2023 at 03:20 pm
  • Dish Network Corp(NASDAQ: DISH) stock is up Friday amid reports of selling wireless plans for its mobile phone service through Amazon.Com Inc(NASDAQ: AMZN).
  • Amazon has been talking with wireless carriers about offering Prime subscribers $10 a month or possibly for free and bolster loyalty among its biggest spending customers.
  • The company is negotiating with Verizon Communications Inc (NYSE: VZ), T-Mobile US Inc (NYSE: TMUS), and Dish for the lowest possible wholesale prices, Bloomberg reported citingknowledgeable sources.
  • The discussions have been going on for six to eight weeks and have also included AT&T Inc(NYSE: T) at times.
  • Amazon's deal could act as a breather for the wireless industry in the form of wholesale revenue and traffic to newly expanded 5G networks. 
  • But it could also chip away at the big carriers' customer base left with minimal bargaining power after pouring billions of dollars into super-fast, high-capacity 5G wireless networks. As a result, TMUS, VZ, and T stocks are trading lower Friday.
  • Analysts say U.S. Prime membership has stagnated since Amazon boosted the annual price from $119 to $139 for privileges like speedy free delivery, video streaming, and access to 100 million songs. However, "P rime membership continues to grow year-over-year as the value members receive continues to increase,” Amazon told Benzinga.
  • Amazon is vying with Walmart Inc(NYSE: WMT), whose $98-a-year Walmart+ membership proved attractive as a lower-cost alternative offering many of the same perks as Prime and free grocery delivery on orders of at least $35. 
  • Amazon spokesperson confirms the earlier report to Benzinga, " We are always exploring adding even more benefits for Prime members, but don’t have plans to add wireless at this time."

  • Amazon in February raised its free grocery delivery threshold to $150 from $35.
  • Dish is already working with Amazon, whose AWS division provides cloud computing to run the core network for its wireless service. Dish will also likely start selling its Boost Infinite wireless service on Amazon by July.
  • Price Actions:DISH is trading higher by 20% at $7.55 on the last check Friday. TMUS shares are trading lower by 7% at $128.86, VZ shares are trading lower by 3.25% at $34.50, and T shares are trading lower by 5% at $14.93.

Thanks for sharing some of those vehicles 

EXPE Updated View

Posted by steve on 2nd of Jun 2023 at 01:49 pm


Posted by steve on 2nd of Jun 2023 at 01:47 pm

NNOX - Chart Link - popped out of it's coil

According to Bloomberg 0DTE are

Posted by steve on 2nd of Jun 2023 at 01:37 pm

According to Bloomberg 0DTE are coming to European Stocks. The casino is expanding. 

One note on the SPX:

Posted by steve on 2nd of Jun 2023 at 01:36 pm

One note on the SPX:   A 1.272 extension of the previous decline is 4300 with the .618 retracement of the entire decline at 4311.  (Just guideposts) 

Remember this post - that

Recent Friday's

Posted by steve on 2nd of Jun 2023 at 01:30 pm

Remember this post - that has been a theme and I pointed it out for all of you - click on link where the arrow points to review 

Start out by reading the above sticky (Top Down Approach and click on the Title Link ) and using the Search Function for some past references.  Also many of the ideas here are NOT just for day traders - take time to review many of the past setups (especially longer term base plays).  

Okay - going to take

Posted by steve on 2nd of Jun 2023 at 01:01 pm

Okay - going to take some time to get up to date on some research - beside just tracking the market I spend time researching new undertakings.   One such company is Holcomb who the world will be hearing about in the future. 

SPX 4285 is resistance -

Posted by steve on 2nd of Jun 2023 at 12:54 pm

SPX 4285 is resistance - unable to contain here and likely 4300 soon 

Thanks Roger - now insurance has become cheap

LOL - Grain Belt Premium

I'll have to drink a PBR tonight 

Posted by steve on 2nd of Jun 2023 at 12:43 pm

LOL - Grain Belt Premium is good beer.  Honestly, I could tell you more drinking stories than just about anyone from my college days.   Fun times. 

You want to know a fact.  Despite having a Masters in Chemistry and a BrewMasters Degree my Grandfather was hired during the great Depression for another reason.  He was hired to become the QB (in additon to brewmaser) of the LaCrosse Old Stylers who played against the Green Bay Packers and Chicago Bears. 

IWM Views

Posted by steve on 2nd of Jun 2023 at 12:41 pm

IWM - Chart Link

IWM - Chart Link

This is a map I laid out many weeks ago = still tracking for now.  Will it come to fruition? Who knows but I Project, Monitor and Adjust.  

Today, as I have discussed recently, we have seen some flows into others areas. 

Ian - to be clear - what I mapped out was shorter term structure only - I view the move up as a complex corrective move BUT all that matters is the trend and one should respect until evidence changes.    See my liquidity post as well from May 16th.   Lastly, what matters is YOUR PLAN not some prognostication - remove that from your thinking and you will see a vast improvement.    Does anyone here realize that the entire move off the October lows is simply an expansion of P/E?  That's a FACT earnings have contracted - again who cares as liquidity drives the market so simply respect the trend until evidence changes.  More importantly,  take TIME to develop and institute a PLAN each and EVERY DAY. 

Bandit have a nice weekend 


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